Tata Steel Set to Begin UK Low-Carbon Steel Plant Construction in July 2025, Operations Start In 2027

New Delhi, June 8: Tata Steel has announced that it is set to commence construction of its £1.5 billion electric arc furnace (EAF)-based low-carbon steelmaking facility at Port Talbot, UK, in July 2025. With construction set to start in July, Tata Steel anticipates that commercial operations will commence by 2027.

According to the company’s FY2024- 25 annual report, Tata Steel has received the required planning approvals for the project. One of the main reasons for the project is Tata Steel’s decarbonisation strategy. The project is also being supported by £500 million in funding from the UK government.

Tata Steel’s Transition to Greener Steelmaking

Tata Steel is transitioning away from traditional blast furnace operations towards electric arc furnace technology as it uses locally sourced scrap to produce low-emission steel. The move will help Tata Steel reduce over 50 million tonnes of carbon dioxide emissions over the next decade.

“We are now transitioning to decarbonised and state-of-the-art EAF-based steelmaking by FY2027- 28,” said CEO & MD T V Narendran and Executive Director & CFO Koushik Chatterjee in the report.

Tata Steel has already decommissioned its end-of-life blast furnace units at Port Talbot. In the meantime, the company is using imported substrates from its facilities in India and the Netherlands, as well as other external sources, to supply its UK customers.

Tata Steel’s Cost Rationalisation Strategy

Tata Steel is undertaking major cost rationalisation efforts as a part of its broader structural transition. Fixed costs in the UK are expected to decline from £762 million in FY25 to £540 million in the next fiscal year.

The cost-saving measures include optimisation of substrate sourcing, streamlining downstream operations, IT infrastructure upgrades, and reduction of corporate overheads.

A Strategic Pivot for the Future

Chairman N Chandrasekaran stated that the company is firmly on track with its transition to low-emission steel production. “The decommissioning of two blast furnaces at Port Talbot has cleared the way for the next-generation Electric Arc Furnace (EAF) project, supported by the UK government,” he added.

Once fully operational, the EAF plant will have the capacity to produce 3.2 million tonnes of low-carbon steel annually, positioning Tata Steel as a leader in sustainable steelmaking in the region.

Share Price Effect 

The shares of Tata Steel opened slightly lower at ₹157.25, down 0.16% or ₹0.25 during the early market session on Monday, June 9th. It remains to be seen where the share price closes at the end of today’s market session.

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